Just caught a clause in a standard contract that blew my mind

I was going over a boilerplate agreement a buddy sent me last week and I almost missed it. There was a tiny line buried in the payment terms that said the client could hold 20% of the fee until 90 days after I delivered the final file. I had no idea that was even a thing in standard contracts. I looked it up on a legal blog for freelancers and apparently it's called a 'retention clause' and it's super common in certain industries. It's meant to cover hidden defects but for creative work it just feels like a way to push off payment. Has anyone else run into this kind of hidden holdback in their own contracts?

3 comments

3 Comments

sam_cooper4d ago

If it's supposedly for hidden defects in creative work, who gets to decide what counts as a defect?

shane_wilson4d ago

Trust the lawyers to sort out who @sam_cooper gets to blame.

brian_hart4d ago

Yeah but is a 90 day hold really that big of a deal for most freelancers? Seems like people just get dramatic about standard business stuff these days.